Are you willing to invest in Thailand?
That is undoubtedly a brilliant idea, but you should do thorough research before doing so as the COVID-19 outbreak has brought a change in tides in the Thai Market. Although the GDP is witnessing a fast-paced recovery, yet, you must go through a deep analysis of the industry you are willing to invest in. This article can help you ascertain and support your decision with facts.
COVID-19 outbreak has been catastrophic for economies of all scales throughout the world. Thailand too is not an exception and some major industries did face business setbacks. But surprisingly, many secondary and tertiary sectors came to the forefront to hold the nation’s GDP and prevented it from a crash.
Post COVID-19 Agriculture Industry in Thailand
According to the reports of World Bank, 2020, 8% of the GDP of Thailand was contributed by the Agriculture segment of the nation. It is the agriculture industry that employs 31.2% of the active working population of the nation. But surprisingly, the contribution of the agriculture sector to the GDP is declining.
The country is the largest producer of natural rubber in the world and one of the leading producers and exporters of rice. It also possesses sugar, corn, jute, cotton and tobacco among its major crops. Fisheries are one of the most vital trade entities of Thailand and this makes it one of the major exporters of farmed shrimp.
Post COVID-19 Manufacturing Industry in Thailand
The manufacturing sector is well-diversified and accounts for 33.4 per cent of GDP. In 2020, it recruited 22.5 per cent of the working population (World Bank, 2020). Electronics, steel, and automobiles are Thailand’s main industries.
Thailand is a major manufacturing centre for foreign automakers. Electrical components and appliances, computers, cement manufacturing, furniture, and plastic goods are all relevant industries. The textile industry employs less than a quarter of the working population and is no longer as vibrant as tourism, which has replaced agriculture as the primary source of foreign currency.
Tertiary Sectors to Invest in Thailand
Another report of the World Bank states that tertiary sectors of the Thai economy which include financial services are having growth in their proportion of contribution to the GDP. This sector has contributed to 58.6% of the GDP and employed 46.3% of the active population of Thailand.
Tourism had always been one of the vital industries of strategic importance for Thailand. According to a report presented by the Ministry of Tourism, Thailand, there had been an increase of 3.3% in the numbers of foreign visitors in 2019. The country welcomed 35.8 million foreign visitors in the year. Thailand is gradually developing to be one of the top 10 preferred international travel destinations of the world, in which, nearly 28.8% of the total visitors are from China.
The Severe COVID-19 Effect
In 2020, the COVID-19 pandemic had a major effect on the global economy. Global economic activity is expected to contract by 4.9 per cent in 2020, according to the International Monetary Fund (IMF), which is 1.9 percentage points lower than the April 2020 World Economic Outlook (WEO) projection and worse than the global financial crisis (IMF, 2020).
The pandemic’s effect appears to have hit both sides of most industries and markets in Thailand. Demand disturbances colliding with supply issues make the short-term outlook for agriculture, manufacturing, and services unclear.
Final Words
Many leading industries of Thailand are dealing with a setback due to the COVID-19 pandemic. Whereas, few overperformed to fulfil the vacuum. This is an overview of the current status of the Thai Economy. The facts and figures will surely help you to confirm the industry to invest in Thailand.
The nation is aiming to recover from the losses and boost the economic conditions. Consequently, BOI Thailand is focusing greatly on the Bio-Circular-Green or BCG Economy model. The BOI has various reductions and tax exemptions policies for the target industries of the BCG Model. Noteworthy, Agriculture is one of them.
The BCG Model of Thailand not only promotes Agriculture, it is having 3 more industries on focus. They are Medicine and Clinical Facilities; Biotechnology, Bio-petroleum and Biochemicals; and, Tourism and Creative Economy. Thus, the nation has a wide scope of investment for foreigners. Moreover, Thailand has bundles of investor-friendly plans to attract Foreign Direct Investment.
If you have any idea or business concept ready for implementation in the Thai Market, feel free to communicate with us for a brief round of discussion. We assure you of the best and perfect legal guidance and support in registering your company in Thailand. Additionally, we can help you with the accounting and taxation process thereafter and throughout. To invest in Thailand, feel free to request a brief and free consultation at [email protected].
